Trump and Lasry to Get Into the Game

Wednesday, October 26th, 2011 by Nadia

If online gambling is finally legalized in the United States, it is likely that there will be many parties interested in launching poker sites. Two who definitely want to be dealt in are Donald Trump and Marc Lasry.

Joint Online Gaming Venture

Lasry, a hedge fund manager and owner of Avenue Capital Group, and Donald Trump of Trump Entertainment, will collaborate to form a joint venture. This will happen only if online gaming is legalized in the US. Avenue Group now controls Trump Entertainment and will own 10% of the new venture.

This collaboration comes at a propitious time with there being a new drive to legalize online gaming by states like New Jersey and Iowa. Trump Entertainment has bases in both these places and has the license to open casinos there. Americans bet around $6 billion annually on offshore websites. This sizable amount has made authorities reassess their initial stances on the issue. Casino companies are also looking for new ways to grow and develop.

According to Executive Vice President of Development and Acquisitions of Trump Organization, Ivanka Trump, online gambling would be a big source of taxable income for both State and Federal Governments. It can also create a lot of jobs.

Rising From Bankruptcy (2010)

Trump Entertainment had filed for bankruptcy in July, 2010. In the filing, it was stated that the venture was seen as the best way to look at online gaming with the least amount of costs for the company. More qualified parties may also be a part of the venture.

Ivanka Trump said the venture is putting itself forward to be the biggest online gambling company, once the industry becomes legal in the U.S. The division of responsibility is likely to be such that Trump Entertainment will possess the necessary license, Lasry’s firm will give the capital and Donald Trump will allow the use of his name.

Expenses Incurred By the Venture

According to Ivanka, branding on the internet is an essential part of attracting new players to the online casinos. She said that the idea is to make the Trump brand the most powerful and influential one in this sector.

According to Richard Bronson, the Chairman of U.S. Digital Gaming Inc, setting up a new internet gambling website is an expensive venture. His company created the technology that today allows for internet wagering. Though it is relatively easy and inexpensive to create the website itself, the company must then spend large amounts to establish their brand identity and attract customers.

Third Time Lucky

Trump initially entered the casino business with Trump Plaza in 1984. In 1990, he defaulted on junk bonds worth $675 million from his Taj Mahal Casino and filed for bankruptcy. After this, he turned the company public and renamed it Trump Hotels and Casino Resorts Inc.

In November 2004, Trump Hotels and Casino filed for protection from bankruptcy. When the second bankruptcy proceedings were finished, a year later, Trump resigned his position as CEO. He remained as the chairman and the company was once again reborn as Trump Entertainment Resorts.

The third time that the company filed for bankruptcy saw Trump resigning as chairman. Ivanka too left the board of directors. This happened in February 2009, when Trump held 24% of Trump Entertainment.